Ron Baron said Tesla has bottomed out and the stock price is expected to rise sharply.
Zhitong Finance learned that Ron Baron, a legendary American investor and chairman and CEO of Baron Capital, said that Tesla (TSLA.US)'s stock price has bottomed out and is about to soar. In an interview, the billionaire investor who is optimistic about Tesla said that the company's future lies in their robot taxis and the affordable electric cars they promise. Baron Capital owns about $3.5 billion in Tesla shares, Baron said.
On Tuesday, Tesla announced the launch of new models, including low-cost cars, by 2025. Earlier this month, Tesla abandoned plans to release a $2.5 million Model 2 car. But Baron believes that within 10 to 15 years, all cars will be electric. He added that the trend of hybrid cars “has delayed action to some extent so that car companies don't have to lose money on electric cars”; hybrids are too expensive and don't work well enough.
Furthermore, he said that the reason Tesla's stock price fell (33.65% year to date) was that people feared that Tesla CEO Elon Musk would abandon the idea of producing low-cost cars, but he didn't. Tesla has the capacity to produce 3 million low-cost cars a year, he said.
Additionally, Baron said SpaceX will grow 20 times in the next 15 years and 4 times in the next 6 to 7 years.